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Looking at how to save in 2019

There's no short cut when it comes to building your savings unless you're lucky enough to win lotto!

It generally takes discipline and dedication over the medium to long term. But how hard is it for the everyday Australian to save in 2019?

Recent reports show that about a quarter of Australian households have less than $1,000 in cash savings and one in five Australian’s did not save any money in the previous six months.

Arguably, today Australian’s face more savings headwinds than ever before. 

One of the most significant contributing factors is that the median disposable income for Australian households (adjusted for inflation), has not increased in 8 years. In fact, it’s gone backwards from 2009 to 2019 by 0.76% (or the equivalent of $542).

What’s more, Australian savers have also been hit hard with record breaking low interest rates. In October 2019, the Reserve Bank of Australia reduced the official interest rate to a record breaking 0.75%, with most of the banks passing this cut onto savings account holders further reducing the interest you receive when you deposit your savings. 

The good news though, is that while it might be more challenging to save in 2019 than the past few decades, there are opportunities available for everyday Australians. And it’s never too late (or too early for that matter) to start saving.

Investment bonds – an alternative way to save

Investment bonds have been around for some time but remain less well known to many Australians. 

Investment bonds are all about taking advantage of their tax effective features which are not available through any other traditional savings or investment products, establishing long-term savings habits and benefiting from compounding returns to really accelerate your savings.

Adnan Glinac, executive general manager of Life & Super at Australian Unity, says investment bonds make it easy to set up a regular savings routine, and is an effective way to save for the future, such as a home deposit or the dream holiday.

“The key is to make a start. Begin with as much as you can and then be disciplined. Ideally setup a regular savings plan and make additional contributions frequently. 

“The more you contribute, the better it’s going to be for you in the long run as you will also benefit from the compounding effect of your earnings being reinvested,” Adnan says.

What sort of returns do investment bonds offer?

Similar to other investment products or superannuation, the money you deposit in your investment bond earns a return.

You can select from various investment options depending on your risk tolerance, your time frame and the return you’re looking for. Returns vary depending on the investment options selected and the performance of the underlying fund/s.

Why are investment bonds so tax effective?

Investment bonds are a tax paid product. This means that while you're invested, we pay the tax on your investment earnings to the Australian Tax Office at the 30% company tax rate. As we pay the tax on your behalf, you don’t need to include it on your personal tax return while you’re invested.

Once you hold your investment bond for 10 years or more, you can withdraw your money with no personal income tax to pay.  And even if you decide to withdraw your money before the 10 years, you can take advantage of the 30 per cent tax offset to reduce your personal income tax.

“Many investors can’t believe that there is no personal income tax to pay, if the investment is held for 10 or more years’ say Adnan. 

We remind people that investment bonds are designed to be held for 10 years to generate maximum tax effectiveness. You also need to be careful that each year you only contribute up to 125% of the previous year. So, the more you can put in upfront, the more you can invest in future years. 

When is the best time to start saving with an investment bond?

Right now, with an environment of low wage growth and record low interest returns, it’s never been more important to evaluate how you’re saving. 

“The main thing is to simply get started and save often, says Adnan.

“You don’t need to start out with much, a little can go a long way if you let the power of compounding interest and tax effectiveness do some the heavy lifting for you. 

A new era of investment bonds

Australian Unity’s latest investment bond, 10Invest, is an easy to  use, low-cost, tax effective investment bond, specifically designed to help you save for the future. Whether you’re an experienced investor, or new to the world of investing, 10Invest is designed to be simple and self-service. 

For more information on the advantages of saving with 10Invest, please visit


Important Information

© 2019 10Invest (‘Lifeplan Investment Bond’) is issued by Lifeplan Australia Friendly Society Limited ABN 78 087 649 492 AFS License number 237989, a wholly owned subsidiary of Australian Unity Limited ABN 23 087 648 888. 

Information provided here is indicative only. In any decision, you should only rely upon the content found in the relevant disclosure document, which you must read, since an investment can only be processed from an application form attached to it. Any decisions relating to a financial investment should only be based upon a consideration of your overall objectives, current and anticipated situation or needs, and should not be influenced by historical data such as past performance.

Any tax information provided here and in any disclosure documents is general in nature and is only intended to provide a guide on how tax may affect investors. Tax laws may change in the future and may affect an investor’s tax position and the tax information described in any disclosure documents issued. Investors should seek independent tax advice relevant to their particular circumstances.


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